Budget Update - August 2025

San Francisco finalized its $15.9B budget for FY 2025-26. After weeks of public input and negotiation, the Board of Supervisors restored $42.4M for nonprofits and community services, resulting in far fewer layoffs, around 40 jobs cut, instead of the hundreds first projected. The city still faces a two-year shortfall of $876M, handled by eliminating 1,400 positions (mostly vacant), reducing spending, reverting contracts to pre-pandemic levels, and ending one-time funding for ongoing needs. $400M is set aside to guard against future cuts. To address the ongoing deficit, the Board gave Mayor Lurie authority to move up to $19M in business tax revenue toward mental health, street cleaning, and homelessness prevention. But the cuts didn’t go far enough. We would have preferred to rip off the Band-Aid, rather than phase in solutions over several years. Hopefully, this is just the first step toward genuinely fixing the city’s budget problems. What a long, strange trip it’s been.